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Quotes tagged “Ad Tech”
Technology can be tricked or defeated. Good guys’ technology will always be playing catch-up with the bad guys’ technology. When they do catch up, the hackers will always find new workarounds because that’s what they do – they hack.”
In a perfect world all of this would be done on the server side. The primary benefit would be reduced payload size and lower latency in the browser. It’s not likely to happen, however. It would require SSPs, exchanges and ad servers to figure out how to work with each other in a server-to-server relationship. These companies tend to be competitors; count that as a business reason that will prevent a server side solution.
Additionally, Real-Time Bidding (RTB) is already a server side auction with discrete buy-side demand sources simultaneously bidding on inventory. It is very likely that a server-side header bidding solution would just end up looking exactly like RTB. And, once again, client side header-header bidding would probably come about to try and take advantage of the disparate server-side header bidding solutions.”
How is this suboptimal for overall revenue? They routinely forego scarce, high-value RTB demand in favor of direct sold campaigns, which could have been served to the next visitor. For example, if two people visit your website at the same time, when you as a publisher are 50% sold through, one of those users will be served the direct sold campaign and the other will be sent to the indirect channel. They're both worth $15 to the direct advertiser, although visitor A is worth $10 in the RTB marketplace while visitor B is only worth $1.
The publisher's ad server usually doesn't know how much each visitor is worth within the indirect channel, when considering its decision on whom to serve the direct sold campaign to. Even if it did, $15 still beats $10 and a standard auction – awarding the impression to the highest bid – would still result in the wrong decision, which is to serve the direct sold campaign to high-value visitor A and send visitor B to the indirect channel. The right decision is to send high-value visitor A to the indirect channel and serve the direct sold campaign to visitor B because it means the publisher earns $25 instead of $16.”
DSP expenses, however, have nothing to do with advertiser budgets. After covering overhead like people and facilities, DSP costs scale with the number of bids the platform must process. The core technology of a DSP becomes more expensive to operate as the volume of incoming bid requests grows. Every lost auction is pure cost to a DSP, driving down its profitability.
The trouble with unified auctions is that they drive up bid requests without bringing more revenue into the system. The value proposition of a unified auction hinges on increased bid density — more demand sources participate in every impression. But the byproduct of increased bid density is decreased win rates. Only one demand source can win an impression, so as more bidders participate, more of them lose. A spike in lost auctions is an economic crisis for a DSP.”
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This page was created by our editorial team. Each page is manually curated, researched, collected, and issued by our staff writers. Quotes contained on this page have been double checked for their citations, their accuracy and the impact it will have on our readers.
Kelly Peacock is an accomplished poet and social media expert based in Brooklyn, New York. Kelly has a Bachelor's degree in creative writing from Farieligh Dickinson University and has contributed to many literary and cultural publications. Kelly assists on a wide variety of quote inputting and social media functions for Quote Catalog. Visit her personal website here.
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